Energy minister says stable fuel purchase system needed

Energy Minister Udaya Gammanpila has called on the government to come out with a stable plan to meet expenses for fuel imports after pointing out that an Indian loan secured will help the country to maintain fuel stocks only until end of February.

Mr Gammanpila told Timesonline that the country can purchase sufficient fuel for the next two months with the USD 500 million loan from India, but cannot continue thereafter.

He said that the problem will be aggravated after February next year as a six-month agreement with PetroChina Company - the listed arm of state-owned China National Petroleum Corporation ends. The purchases were made by a guarantee through a Treasury Bond.

He said the government will have to come up with pricing formula or come up with a long-term agreement with a country which could provide fuel.

“We need a stable system to provide for fuel purchases”, he said.

A senior official of the Ceylon Petroleum Corporation said that they were expecting another crude oil shipment in the first week and require a payment of USD 58 million.  “We are trying our best to raise the funds so that the refinery operation can continue uninterrupted”, he added.

The Sapugaskanda refinery operations were shut down on November 16 and resumed this week due to the lack of fuel supplies.

This was after a shipment which had been ordered earlier had arrived in the country.

CPC sources said that though 5000 mt were refined daily, now the capacity has been dropped to 2500 mt in order to prolong the continued operations of the refinery.

He said that the CPC was delaying operations until the next shipment arrives. “If the shipment does not come in January, we will be heading for another shut down”, he said.